Tuesday, January 10, 2012

Making New High.

We all have seen the futures rising and making new high for the year. If this extends to the trading session and it looks like it will, then it will clear the future course of action.If you remember, I was expecting the Santa Rally to top around 1300 level in SPX but it did not and instead stopped around 1280. It might make one last attempt. A look at the SPX chart shows that it is an ascending triangle and there have been only two push up so far.

There will be a third push and subsequent failure. So I am keeping my short position because even at this break out level, it will be out by only 10-15 points. In fact I plan to add VXX today.

We have been in this position before. So we will sweat it out a bit but once this zone of indecision is taken out, then the downside is much more.